AUDJPY Facing Oversold Conditions
farhan fazal
AUDJPY·
Dec 04 2021
Take Profit +2.32%
Holding time 2d3hr
79.116
Entry price
80.948
Take profit price
MARKET FORECAST :
The AUD/JPY declines sharply as the New York session ends, down some %, trading at 80.13 at the time of writing. The market sentiment is downbeat at press time, as depicted by the major US stock indices finishing in the red at the Wall Street close, as the US CDC reported the first COVID-19 Omicron case.
In South Africa, COVID-19 cases doubled from Tuesday. Also, the UK, Switzerland, and Brazil, added to the list of countries reporting Omicron cases. Despite being “negative” news, the World Health Organization (WHO) chief scientist commented that vaccines would protect against severe cases of the variant. On Wednesday, in the overnight session, the AUD/JPY peaked at 81.47, falling sharply throughout the second half of the day, down to 80.00, breaking on the way down the 50-hour simple moving average (SMA), which at press time lies at 80.77.
That said, the AUD/JPY pair would stay lying on the dynamics of market sentiment. Further, the Reserve Bank of Australia’s (RBA) dovish stance would limit any upside move in the pair.
BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :
The 1-hour chart depicts the pair is extending its free fall, printing a fresh two-month low at 79.97. The pair has a downward bias, portrayed by the daily moving averages (DMA’s) staying above the spot price with a downslope, with the 50-hour SMA -the shortest-timeframe- at 80.77, being the closest to current price action.
In the outcome of falling further, the AUD/JPY first support level would be the S1 daily pivot at 79.58. The breach of the latter would expose the S2 daily pivot at 79.08.
On the other hand, AUD/JPY first resistance would be the daily central pivot at 80.52. The break above that level would expose the 50-DMA at 80.77, followed by the confluence of the R1 daily pivot and the 100-hour SMA at 81.